Dave Telford, who is staying at the beach in a camper van, told 1 NEWS he saw three IRB's come onto the beach, before the occupants let off a flare, alerting the Westpac Rescue Helicopter where to land.

"Initially it looked like an exercise, but then we thought Westpac would not be involved if it was an exercise, then having the paramedics running was a good indication.

"It's obviously very sad, no one likes to see a life lost, and for the guys involved in it, it must be heart-breaking," Mr Telford said.

Sergeant Taylor is survived by his wife and four children.

Sergeant Wayne Taylor.

Source: NZ Defence Force

He joined the Royal New Zealand Infantry Regiment as a member of the Army Reserve in 1993 — joining the Regular Force in October 1997, serving in East Timor and Afghanistan.

"Many of the Regiment, both RNZIR and NZSAS, will remember him as an outstanding soldier, leader, father, family man, and friend to many, as well as being an all-round top bloke," Major General Peter Kelly Chief of Army said.